Demand for Organic Food Exceeding Supply

Published By : 06 Jul 2015 |Published By : QYRESEARCH

The rising number of food scandals along with the increasing awareness about toxins in conventionally grown food has deviated consumers towards the organic food aisles in supermarkets. Consumers’ awareness regarding genetically modified foods is also rising, which is further fueling the demand for organic food in western and eastern markets.

In the past few years, there has been a significant growth in the demand for organic food. This high demand can be contributed to a great degree to the independent study revealing the negative effects of conventionally grown foods like GMOs. This sudden popularity of organic food should have resulted in the growth of supply as well. However, this is not the case. This demand has skyrocketed, which has resulted domestic supply falling short.

The sale of organic foods has grown drastically in the past ten years. In 1997, the organic food industry was approximately valued at US$3 billion, as per the estimates from the U.S. Department of Agriculture. And just in six years, this industry experienced a spike in revenue, which was higher than 200 per cent to a US$10 billion. The annual increase demonstrated by this industry was of 20 per cent.

The effect of this spike in demand for organic food from consumers is that the supply of organic food is not able to cope with the demand. Several U.S. farms that are involved in organic farming are small and rely on collecting seeds from the past year’s crop. Also, several hundreds of these farmers have shut down operations due to the increasing lawsuits from Monsanto.

Nonetheless, if the organic community movement maintains its pace and is complimented by all the innovations in organic farming then it is possible to increase the supply and meet the high demand. Furthermore, this will be a great day for the organic food/farming community as it will lead to decreased prices of organic food.